Should I Buy or Lease a Car?

Does it make more sense to buy or lease a new Honda HR-V? Image source: Honda

Does it make more sense to buy or lease a new Honda HR-V? Image source: Honda

A few months ago, I ran a “thought experiment” to answer the question: should I buy a car or use car sharing services? I was a bit surprised to find that the answer really depends on a lot of factors that surely vary from person to person.

With this in mind, I thought I would run another calculation to look at the numbers behind buying vs. leasing a car. I was always taught growing up that it is better financially to buy a car than to lease a car. Having never looked at the numbers for myself, I thought it was time to put this to the test. Continue reading

Should I Buy A Car or Use Car-Sharing Services? Part 1

Recently a friend mentioned that he is thinking of buying a car. He lives in Cambridge, like me, and does not currently have a car. He relies on walking, transit, and various car or ride sharing services to get around. My immediate reaction was to say “don’t do it!” My gut told me that it would inevitably be more expensive to buy and maintain a car than take Uber or rent a Zipcar, even if you took Uber or rented a Zipcar every time you had the slightest inkling to do so.

I thought that I should run some numbers and really test this theory out. I’m sure that many people living in urban areas have had this debate with themselves. To own a car or not to own a car, that is the question!

This exercise turned into a LONG post, so I’ve broken it into three pieces so as not to overwhelm anyone. Today, I will share my analysis of what it costs to own a car. Tomorrow, I’ll post my analysis of the costs of car sharing and cab services, and finally on Saturday I’ll share some additional considerations that I think should factor into the decision to buy a car.

It is worth noting that I do own a car, even though I live in the city and have good transit access. As with everything, the decision to own a car is a personal one, and just doing what the numbers say isn’t always the right choice. Continue reading